16 May 2008
Official statistics on economic productivity have disclosed the extent to which the British economy is concentrated in the Southeast, prompting fears that the gap between regions might have increased.
Regional trends, published by the Office for National Statistics on May 8, shows that on gross value added – a measure of the contribution to the economy of each individual producer, industry or sector – figures per head for London are over 50% above average. The Southeast figures are almost 10% above average, and all other UK regions fall below the national average.
While the figures for London have increased, they have remained broadly the same for other regions between 2001 and 2005. Wales and the Northeast have the lowest figures.
Paul Vickers, analyst in demography and regional statistics at the ONS, said: 'This shows there might be a slight widening of the gap, but it's not conclusive at the moment.'
However, the regional disparity could be narrowed by the economic slowdown, according to forecasts by financial services company Experian, published on the same day.
The company predicts that a performance advantage enjoyed by the South in the past two years will narrow over the next five years.
The company said: 'Next year the North-South division will disappear for the first time since 2002, chiefly because of the abrupt London slowdown. Thereafter, the South will pull ahead again, but the yawning gaps of the recent past will not be repeated.'
Adam Marshall, head of policy at Centre for Cities, told Public Finance that both Labour and the Conservatives were again thinking about having elected mayors in big cities to drive economic growth. 'We are strong supporters of directly elected mayors, especially for our big city-regions to improve economic outcomes over the medium to long term,' he said.
The think-tank published a report, City links, in March, arguing that large cities were well placed to drive wider regional growth.
Regional trends also shows 'tremendous diversity' across the UK on statistics from mortality rates to air travel, and strongly emphasises how neighbourhood data could assist policymakers. Deprivation indicators show that the percentage of benefit claimants is reducing more consistently in deprived areas than in non-deprived areas.
PFmay2008
